Graphite electrodes are mainly made of petroleum coke, needle coke and coal pitch through calcining, batching, kneading, forming, baking, graphitizing and machining. Graphite electrode is a conductor which releases electric energy in the form of arc in the furnace to heat and melt the charge. The following are the main factors that affect the price fluctuation of graphite electrodes.
Steel tubes are produced by graphite electrodes in factories.
1. THE INCREASING DEMAND OF HIGH-QUALITY STEEL
This is one of the main factors propelling the market growth of graphite electrodes. The rapid development of steel industries such as construction, automobile, infrastructure, aerospace and national defense has led to an increase in steel demand and production.
Steel-making process with electric arc furnace.
Steelmaking by electric arc furnace
2. ELECTRIC ARC FURNACE IS THE TREND OF THE TIMES
Affected by environmental protection and high production flexibility, the steel-making process in developing countries is changing from blast furnace and ladle furnace to electric arc furnace (EAF). Graphite electrodes are the main energy source for electric furnace steel consumption, and as much as 70% graphite electrodes are used in electric arc furnace steel making. The rapid development of electric furnace forces the production capacity of graphite electrode to be increased.
Part of the graphite electrodes production process is shown.
Manufacturing process of graphite electrodes
3. GRAPHITE ELECTRODES ARE CONSUMABLES
The use period of graphite electrode is generally about two weeks. However, the production cycle of graphite electrodes is generally 4–5 months. During this use, the production capacity of graphite electrode is expected to be reduced due to national policies and the heating season.
4. HIGH-GRADE NEEDLE COKE SHORT IN SUPPLY
Needle coke is a key raw material for the production of graphite electrodes. It is a calcined petroleum coke (CPC) which accounts for about 70% of the input cost of graphite electrode production. The price increase caused by the limited number of needle coke imports is the main reason for the direct increase in the price of graphite electrodes. Meanwhile, needle coke is also used in the production of electrode materials for lithium batteries and aerospace industries. These changes in supply and demand make the price of graphite electrode is inevitable.
A piece of needle coke is held in the hand of a factory worker.
Raw material of graphite electrodes –needle coke
75% to 80% supply of needle coke is used for graphite electrodes industry.
Needle coke demand share percentage
Comparison of graphite electrodes exported from China to the US of 2018 and 2019.
5. TRADE WARS BETWEEN THE WORLD'S MAJOR ECONOMIES
This have led to a sharp decline in China's steel exports, and forcing other countries to increase production capacity. On the other hand, it has also led to an increase in the export volume of graphite electrodes in China. In addition, the United States raised tariffs on Chinese imports, which greatly reduced the price advantage of Chinese graphite electrodes.
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